9/16/2008 @ 7:09PM

Lehman's Brothers

Lehman Brothers went bankrupt Monday. Outside Lehman’s building in midtown Manhattan, wire service photographers smoked cigarettes as cops barked at tourists to stop harassing departing bankers. Two 30-somethings in suits took turns taking pictures of each other in front of Lehman’s steel and streaming pixel-screen façade. They seemed surprisingly upbeat for having just lost their jobs.

“Arrogance, that’s what destroyed this firm,” said one of the bankers in a slight European accent. “They could have gotten out of this mess four months ago if they wanted to.”

Executives, they said, had been foolhardy about their exposure to real estate, and their decisions to grow the firm’s portfolio had more to do with executive compensation than expected profitability.

The older of the two had been with Lehman
for 13 years. “This was a great place to work,” he said. “Really smart people gave a damn about this place.”

At Bobby Van’s steakhouse, a Lehman hangout around the corner on West 50th Street, the bar was full of guys in wrinkled shirts, a jolly sweaty scene like the end of a family wedding, or a wake. At a table flanked by bankers in their mid-twenties, ties loosened, expressions glazed, one offered to “tell us what really happened.”

“Don’t be that guy,” said another. After a couple drinks, he relented and let his friend speak.

“Executives, I should say an executive–could have stopped all of this,” said Banker No. 2. (the only way he agreed to be identified). “Dick Fuld decided to play chicken with the federal government and I guess you could say he got half run-over.”

He added: “It didn’t help that they started buying Alt-A mortgages in Q1 ’08 or that they decided not to raise serious capital in Q2 ’08.”

“You have to keep everything in perspective,” said banker No. 1. “I’ve got a buddy with a kid and a wife at home. I can’t stress about myself. There’s just no comparison.”

The young guy next to him looked on quietly, nursing a now-watery cocktail. He started at Lehman 13 months ago, fresh from Harvard.

“There aren’t other places like this where they really care about developing the younger guys and invest in you. My friends at other banks say they aren’t like that,” he said.

“You know who I feel really bad for? The poor guys who started today,” Banker No. 1 said after a lull. That morning he’d had a few new, freshly trained charges assigned to him. They were let go on their first day. Everyone at the table expressed sympathy for anyone who’d had such a short-career at Lehman Brothers.

Walking out of the bar, a few of their co-workers wrestled playfully in a pile of trash. One appeared to knock out the other’s tooth, bloodying his shirt.

The Lehman employees from the table cringed and asked that the curbside tussle not be mentioned. They were planning on heading into work the next day, hoping some part of their firm would be bought and their jobs would be safe.